Dish Network CEO Charles Ergen said the satellite TV provider has no "grand strategy at this point" to pool its spectrum resources into any kind of wireless venture, a comment that could cool off speculation that Ergen is amassing a spectrum portfolio in advance of a major wireless gambit.
Dish's proposed $1 billion purchase of bankrupt satellite firm DBSD North America sparked speculation among analysts about Ergen's plans. However, during Dish's fourth-quarter earnings conference call, Ergen said repeatedly that spectrum is a valuable asset but that the company looks at different spectrum holdings individually.
Ergen said Dish has been involved in FCC spectrum auctions for the past 10 to 15 years, and noted with some chagrin that the company has rarely won. He said that when spectrum holdings can be aggregated together there are "synergistic" qualities of the airwaves that can create more value.
"If you can do something strategic with it, it has more value or less value if you invest in the wrong way," he said. "If you accumulate spectrum that fits together, you create even more value."
However, he said that right now there are no plans to start a wireless venture, that Dish looks at spectrum holdings individually first and that Dish wants to turn around DBSD's satellite business. Dish is waiting to hear from a federal bankruptcy judge on whether the bankruptcy court will accept its plan for DBSD.
Speculation has centered on what Ergen plan to do with DBSD's 20 MHz block of spectrum in the S-Band. Ergen also is the chairman of EchoStar, which is trying to secure bankrupt TerreStar Networks' assets. EchoStar is TerreStar's largest creditor. Like DBSD, TerreStar holds 20 MHz of S-Band spectrum, and has been trying to launch an all-IP, integrated satellite-terrestrial network using satellite spectrum. Ergen also secured 6 MHz of 700 MHz spectrum in the FCC's 2008 auction.
Analysts have noted that Ergen could amass as much spectrum as either Sprint Nextel (NYSE:S) or T-Mobile USA.
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Article updated Feb. 25 to reflect the nature of Ergen's spectrum holdings.